SAR TRADER (Support and resistance trader) is a classic supply and demand trading system designed for EURUSD. The EA sells at zones with bearish pressure and buys at zones with bullish pressure.
What makes SAR TRADER EA beat the competition?
What makes SAR TRADER EA so efficient is its advanced entry and trade management engines, let's have a closer look at these components.
Self adapting grid control:
SAR TRADER EA scales into positions to get the best average entry price on each trade setup, and we will talk in great detail about the advantages as well as the disadvantages related to this system in the Money Management section a bit further down this article.
When scaling into positions, the questions is what distance is the optimal distance between each additional order? This depends on the market dynamics, which are constantly changing from hour to hour, day to day, week to week and so on.
SAR TRADER EA is constantly measuring the market dynamics of the currency pairs it is trading and by doing so it is able to calculate what the optimal distance in pips will be for each trade setup. In other words, the EA adjusts its trade engine to the current market conditions and either increases or decreases the distance between each additional order. This is such a powerful feature and one of the key designs that give SAR TRADER EA its incredible edge.
Advanced supply and demand tracker to find the most favourable entry price:
We have all heard the saying "buy low - sell high". And that is exactly SAR TRADER does. It has an advanced supply and demand zone tracker built into its trade engine. Once a key support/demand area has been established the EA places a pending buy limit order at that price level in the anticipation that should price come back to this key level, there will be a strong interest from institutional market participants to buy large positions which will make the exchange rate reverse and reach for new highs.
The opposite happens when a key supply/resistance area has been determined, the EA will place a pending sell limit order at this price zone knowing that there is a high probability that the bearish pressure will dominate the buyers at the zone which will result in a declining exchange rate into the near future from this point on.
SAR TRADER EA scans the market continuously, and is always looking to enter at the upmost favourable and discounted price. It looks for zones where price has seen strong rejections in the past. We know that once price come back to these levels there will most likely be strong rejection again. Entering at these price areas with either a surplus in demand or supply gives the EA its powerful edge.
Money management:
SAR TRADER EA utilises a money management system called "cost averaging" to scale into positions. This has the advantage that the EA will get the optimal average entry price and always close a trade setup in profit.
However, as it is with all things in trading, every benefit come with certain disadvantages. In the case of a cost averaging system where we keep adding more positions with an increasing lot volume as a trade goes against us, the ultimate danger is that we will drain our entire account while keep stacking up on new orders.
For this reason it is extremely important that you as a user understand how to best use such systems and to not over-leverage your account and taking on too much risk.
First you need to know that SAR SCALPER EA has no stop loss protection. Instead it keeps adding more positions to get a better average entry price on each trade setup. This makes the EA extremely profitable.
BUT....
If your account balance is too small or if your risk settings are too aggressive, you risk to loose your entire account, or at the least loose the "max loss" value that is built into the EA and which gives you the possibility to essentially cut losses and close all positions if the EA should encounter a drawdown bigger than what you feel comfortable with.
So, you will need quite a large account balance to trade safely with SAR TRADER ea. If you do not have a lot of capital, we suggest that you use the expert advisor on a cent account. On a cent account a deposit of 10 USD will actually give you the equivalent of 1000 USD account balance. That will give you plenty of capital to play with. It might sound counter-intuitive to use large account balances to lower risk, but what you need to know is that you need to have a lot of spare capital on your account to have enough capital to scale into positions.
We recommend a minimum of 3000 $/€ account balance when using SAR TRADER with the default settings. Alternatively you can use it on a cent account with as little as 30$/€ starting balance.
The risk settings can be fully adjusted to your needs in the input settings.
Additional features:
SAR TRADER EA comes with a ton of additional features that all can be modified by the user. Let's look at some of them together.
Advanced money management features:
The user can choose between two money management models. The first is a simple fixed starting lot model. Nothing special about this. If you set 0.01 lots, then all initial orders use 0.01 lot as its trade volume.
However, we have also built in a function we call Auto Lot. This input allows the user to use a gradient and self adjusting lot size for the initial order. If the user inputs 1 as the AutoLot value, a trade volume of 0.01 lots will be used for every 1000 account currency balance. If the user sets this input to 10, a trade volume of 0.1 lots for every 1000 account currency balance will be used and so forth.
The Auto Lot function allows the EA to increase its trade volume as your account balance increases.
Advanced order close features:
The user can also choose between two "close orders" models. The first model allows the user to input a money value (in your account currency), and when the floating profit exceeds this value, all orders will be closed.
The second option is much more interesting. Here the user will input a percentage value, and the EA will close all orders when the floating profit exceeds that value.
If the "Auto Lot" model is used in combination with the "Close in percentage profit" model, your risk will always be the same, no matter how small or large your account balance is. And the beauty of it is that the EA will always adjust the settings to scale with your balance as it increases, which will result in a exponential account growth curve.
Trend direction and trend strength filters:
This EA has both a directional trade filter and a trend strength filter built into its trade engine.
When the "trend direction" filter is enabled, the EA will always only positions in the direction of the over all trend.
The trend strength filter has two options. Either this filter will allow the EA to trade when there is high volatility in the market or it can be set to only allow trading when there is low volatility in the market.
These two trend filters together can help to support the supply and demand tracker to find the best entry areas and stay out of the markets when there are unfavourable trading conditions.
Cut losses:
As a security mechanism, the user can choose to set a max draw down before closing all orders. This input can be set as a money value or a percentage of your account balance.
This is not only a safety measure, but can also be used if you are using the EA to pass a prop firm challenge, for example from FTMO.
In these challenges the trader has a daily max loss level and an over all max loss level. So to make it even better suited for prop firm challenge, we have made an input that will allow the user to wait until next day to open new trades, thus making it perfect to avoid the max daily loss rule on these challenges.
News filter:
SAR TRADER has an inbuilt filter which detects news related to the currency pair it is trading. When enabled this news filter will stop trading actions at a set time before any related news event and automatically resume trading a set time period after the news events. This allows the EA to stay out of the market at the most volatile and risky periods. The news filter is fully adjustable by the user. For more information on the news filter refer to the installation guide for SAR TRADER here.